Social security is primarily a social insurance program that provides social protection for poverty, old age, disability, unemployment, etc. HM Revenue and Customs administers the Social Security system in the UK.
Contributions
Known as "National Insurance", it is funded by mandatory contributions (National Insurance Contributions or NICs) paid for by employees and employers on earnings. The self-employed contribute based upon net earnings.
These contributions on your earnings include holiday pay, sick pay and maternity pay.
Social insurance classes
NICs are divided into different classes. The class you pay depends on your employment status and how much you earn.
| National Insurance class | Who pays |
Class 1 | Employees earning more than £184 a week and under State Pension age - they're automatically deducted by your employer |
Class 1A or 1B | Employers pay these directly on their employee's expenses or benefits |
Class 2 | Self-employed people earning profits of £6,515 or more a year. If you're earning less than this, you can choose to pay voluntary contributions to fill or avoid gaps in your National Insurance record |
Class 3 | Voluntary contributions - you can pay them to fill or avoid gaps in your National Insurance record |
Class 4 | Self-employed people earning profits of £9,569 or more a year |
Class 1
Class 1 contributions are paid by employers and their employees. The employee contribution is referred to as the "primary" contribution and the employer contribution as the "secondary". The employee contribution is deducted from gross wages by the employer, with no action required by the employee. The employer then adds in their own contribution and remits the total to HMRC along with income tax.
Class 2
Class 2 contributions are fixed weekly amounts paid by the self-employed. They are due regardless of trading profits or losses, but people with low earnings can apply for exception from paying. Those on high earnings with liability to either Class 1 or 4 can apply for deferment from paying.
While the amount is calculated to a weekly figure, they are typically paid monthly or quarterly. For the most part, unlike Class 1, they do not form part of a qualifying contribution record for contributions-based Jobseekers Allowance.
Class 2 NICs are currently flat-rate weekly contributions of £3.05 per week in 2021-22.
Class 3
Class 3 contributions are voluntary NICs paid by people that wish to fill a gap in their contributions record. This may have been cause by not working during a certain amount of time or by their earnings being too low. The main reason for paying Class 3 NICs is to ensure that a person's contribution record is preserved to provide entitlement to the state pension.
In 2021-22, Class 3 contributions are payable at a weekly rate of £15.40 (2021). This is a flat rate you can pay each week.
Class 4
Class 4 contributions are paid by self-employed people as a portion of their profits, and they are calculated with income tax at the end of the year.
They do not form part of a qualifying contribution record for any benefits, including the state retirement pension.
National Insurance Number
A national insurance number is your own personal account number and is necessary for living and working in the UK.
It acts as a reference number when communicating with the Department of Work and Pensions and HM Revenue & Customs (HMRC), and is used to record your national insurance contributions.
When you are working, your employer deducts a sum from your wages or salary as a NI contribution (you can check the amount from your pay slip). Your employer adds a certain percentage to this contribution.
Your unemployment benefits, your right to Incapacity and Contributory Job Seekers Allowance, Maternity Allowance and Retirement or Widows Pension, etc all depend on your NI contributions. You will also need your NI number if you claim other benefits like Family Credit, Income Support or Child Benefit.
The National Insurance Number can be applied online for if you are both recently employed or actively seeking employment.
How to get a National Insurance Number
You can apply for a National Insurance number if you live in the UK and have the right to work in the UK. You must also be looking for work or have an offer to start working in the UK. If you have already started working you can still apply.
In England, Scotland and Wales the Department for Work and Pensions (DWP) issues NINOs. For individuals who live in Northern Ireland, the Department for Social Development (DSD) issues them. Note that due to Brexit, it is only possible to apply for a National Insurance number in England, Scotland and Wales if you have entered the UK on a visa or if you have entered the UK prior to 31 December 2020 without requiring a visa (for example, if you are an EU national).
As stated above, you can still start working in the UK without a National Insurance number provided if you can prove your right to work in the UK.
During the process of getting your National Insurance Number, Jobcentre Plus office will contact you to make sure that you need a NINO and may arrange for an interview.
The interview will usually be one-to-one (unless, for example, an interpreter is required) and the officer will also need to confirm your identity.
The interviewer will ask you questions about your background and circumstances and ask to see all your official documents, including your passport and any other proof of identity documents, such as passport, residence permit, birth certificate, driving license, marriage or civil partnership certificate. You should take the original documents with you to the interview.
Later on, they will contact you to let you know whether or not your application was successful. If it was successful, they will send a NINO to you. It is important to keep the letter as a reminder of the number (e.g. AB 12 34 56 Z) as plastic NINO cards are no longer issued. It can take up to 16 weeks to get your National Insurance number.
Please note that you can start working before your NINO arrives if you can prove you have the right to work in the UK. You should tell your employer that you have applied for a NINO and give it to them when you have it.
Contact your Jobcentre Plus office to find where you have to go to get your NIN:
Tel: 0845 600 0643 (8:00-18:00)
Web : https://www.gov.uk/contact-jobcentre-plus
Update 12/10/2021
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